Doug Johnson
As the influence of artificial intelligence grows, it’s no surprise that lawmakers at all levels are jumping in to respond. That’s understandable. AI is one of the most innovative technologies of modern times. Thousands of companies across the United States are leveraging AI to transform sectors such as education, disability access, and healthcare. The AI boom is also boosting the economy. According to SAP, Colorado is among the top 10 states “most interested in AI jobs and AI business adoption,” with employers creating tens of thousands of AI-focused jobs.
The immense potential of AI makes effective regulation particularly important. Unfortunately, Colorado Senate Bill 205, which passed a procedural hurdle in the state Senate early last week and cleared a House committee over the weekend, takes a local approach to a complex national policy issue. . By imposing new requirements on AI developers, SB-205 risks stifling innovation and hindering economic growth both in Colorado and beyond.
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Kelly Kinnebrew, founder of Boulder-based AI life coaching platform Minerva, is just one example. Kennebrew shared concerns about the bill with Colorado lawmakers in testimony last week. These concerns center on the bill’s broad and unclear language. She wondered, “What is a high-risk (AI) system?” What is required for a company to comply with the requirement to eliminate “known or reasonably foreseeable” risks?
Given the rapid pace of AI development, this uncertainty creates a dangerous guessing game for businesses. Being misled can lead a company to the wrong end of costly litigation. These concerns are widely shared by Colorado business owners, with more than 100 signers of a letter to the bill’s sponsors warning that the bill would “severely stifle innovation and impose intolerable burdens.” .
Regulation of AI at the state level, which essentially applies to all AI companies, creates a patchwork of conflicting rules and regulations for companies operating across state lines. This means that Colorado businesses must understand and comply with multiple complex and potentially conflicting regulations. The complexity would increase further if other states adopted their own rules and laws. While larger companies may be able to navigate this minefield, a state-by-state approach poses significant compliance hurdles for small businesses and startups, which typically have limited resources.
If we want to encourage more AI innovators in Colorado, we need to remove obstacles, not add them. Of course, that doesn’t mean circumventing AI regulations. Regulations to ban personally targeted deepfakes and protect election integrity are important first steps. More broadly, businesses of all sizes can benefit from clear rules of the road established at the federal level and applied uniformly across the United States.
Fortunately, that effort is already well underway. The Senate recently held a series of AI “insight forums” with industry and government leaders. Lawmakers agree on the need for action to create clear guidelines and standards for how companies collect, use and share data. Indeed, federal AI legislation already in place will provide much-needed clarity to businesses while promoting trust among users of AI systems. Encouraging Colorado’s legislators in Washington to see this bill through is a top priority.
AI regulation must strike a balance between fostering innovation and protecting consumers from potential harm. Proposals like SB 205, while well-intentioned, make it difficult for small businesses to innovate with AI. Ultimately, that means Americans will miss out on some of the transformative benefits that AI will bring. Instead of pushing this bill, Colorado leaders should advocate for federal AI regulation to truly help startups and small businesses in their state thrive.
Doug Johnson is vice president of emerging technology policy at the Consumer Technology Association, North America’s largest technology industry association. He specializes in working with the world’s leading innovators, from startups to global brands, to develop innovation-friendly policies for AI at local, national, and international levels.
